Just under two hours before 50% tariffs on roughly $20 billion worth of Canadian goods were due to take effect, President Donald Trump posted on Truth Social late Tuesday that negotiations had produced a breakthrough. He wrote that Canada and the United States 'have a DEAL!' — conditional on finalising documents — and announced a three-day pause on the threatened duties. The tariffs had been set to kick in Wednesday at 12:01 a.m. Eastern Time; Trump's post came at approximately 10:15 p.m. Tuesday.
In the same message, Trump added a claim that drew immediate scrutiny. 'The great Keystone XL Pipeline, long ago killed by Sleepy Joe Biden, may be awoken from the grave!' he wrote, accompanying the post with an AI-generated image of himself pulling a pipeline labelled 'KEYSTONE' out of the ground.
Canadian Prime Minister Mark Carney offered a more measured account. He confirmed that 'substantial progress' had been made and said 'important work' remained — stopping short of declaring any deal finalised. Carney did not publicly address the Keystone XL claim.
US Trade Representative Jamieson Greer said any agreement would include 'comprehensive market access for all American goods, economic security commitments, digital trade alignment,' and that the US had 'eliminated some of the irritants' of the past year. Neither Washington nor Ottawa officially confirmed that Keystone XL is part of the unfinished agreement, and Trump offered no details on what reviving it would entail.
Keystone XL was first proposed in 2008 by TransCanada — now TC Energy — as a major extension to the existing Keystone pipeline network, intended to carry Alberta oil sands crude to US refineries. President Joe Biden revoked the presidential permit on his first day in office in January 2021, and TC Energy formally cancelled the project later that year. By that point, about 150 kilometres of pipe had already been installed in Alberta, and the project remains fully permitted by the Canadian government. Trump rescinded Biden's revocation upon returning to office in 2025.
Analysts moved quickly to challenge Trump's framing. A successor pipeline — the Prairie Connector, proposed by South Bow Corp. and its US partner Bridger Pipeline — was already underway before this week's talks. The 550,000-barrel-per-day line would run from Alberta to Wyoming and use some already-assembled Keystone XL pipe on the Canadian side. Trump himself signed a presidential permit for the Bridger Pipeline portion of that project in April 2026, authorising construction, connection, operation and maintenance of pipeline facilities at the border. South Bow expects to make a final investment decision by mid-2027.
Oil analyst Rory Johnston said it 'would be completely out of the blue and make little immediate sense to literally reanimate KXL, given the work done on the other projects thus far,' adding that oil markets have evolved since the project was proposed nearly two decades ago. A former executive involved with Keystone XL and an Alberta-based trade expert separately suggested that Trump's pipeline remarks may have more to do with politics than petroleum.
The biggest confirmed sticking point in the negotiations is over automobiles. Washington has offered to cut its 25% tariff on Canadian-made vehicles to 15% — potentially as low as 7.5% for vehicles with sufficient US content — but Ottawa has said that is still too high. That dispute remains unresolved as negotiators race to produce a finalisable text before the pause expires.
Whether the three-day window produces a binding agreement, and whether Keystone XL — as opposed to its Prairie Connector successor — will feature in any final text, remains unknown. What is clear is that Trump's late-night post set expectations his own trade team has yet to confirm in writing.
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